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The court approved Tuesday Morning's sale of certain assets to Hilco Merchant Resources, LLC after an April 27, 2023 sale hearing, authorizing the transfer free and clear of liens and finding Hilco submitted the highest or otherwise best bid and qualified as a good-faith purchaser under section 363(m) source filing. The order followed the debtors' February sale motion and capped a compressed auction process in the retailer's 2023 chapter 11 case, separate from the COVID-era reorganization already noted in the scratch pad.
Piper Sandler's fee application later filled in the economics: the debtors and Hilco signed the asset purchase agreement on April 24, conducted the auction on April 27, and completed the initial closing on April 28 for a $32.1 million purchase price, subject to inventory adjustments source filing. Piper Sandler said it contacted 77 potential purchasers, managed bidder diligence, negotiated bid terms, presided over the auction, and testified at the sale hearing; those materials were later admitted as hearing exhibits source filing.
Tuesday Morning Corporation filed Chapter 11 on May 27, 2020 in the Northern District of Texas after pandemic shutdowns halted store revenue across an off-price home and lifestyle retailer that operated 705 stores in 40 states. The lead debtor listed $92.0 million of assets and $88.35 million of debts as of April 30, 2020, while the first-day declaration said the company employed about 1,858 full-time and 7,151 part-time workers, had furloughed more than 95% of its workforce, owed more than $16 million of unpaid rent, and owed vendors more than $91 million. The initial posture was stabilization plus shrinkage: use DIP financing and cash collateral, preserve operations, and liquidate at least 133 underperforming stores. source filing source filing
The court confirmed the revised second amended plan on December 23, 2020, authorizing a reorganization built around a new ABL facility, senior subordinated notes, a rights offering, backstop support, and a sale-leaseback transaction. The plan economics were unusually favorable for a retail Chapter 11: Class 5 general unsecured claims were to be paid in full, while Class 7 Tuesday Morning equity interests were reinstated. The order also approved a $500,000 administrative claim settlement with Rialto tied to the sale-leaseback dispute, waived the Rule 3020(e) stay to speed implementation, and excluded proposed insider emergence grants, leaving any such awards for the new board after emergence. source filing
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